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The Journal reports that the FBI has issued an alert to Honolulu's legal community calling attention to no less than a "crime wave." In the past several weeks, six law firms have been targeted with this particular scam and have lost a total of $500,000. The scammers contact a firm, posing as a client in need of representation in a civil case such as divorce. The firm then receives a retainer check in amount exceeding the usual firm requirement. This should be the warning. The ever-honest firm wires a refund of extra amount to the "client" only to find, of course, that the original cashier's check is counterfeit.
In a time when law is a global business and clients are located around the world, doing business with clients primarily by email and outside of the country is nothing that would alert a firm to a potential problem, and the scammers have taken advantage of that. In the Hawaii cases, the "clients" asked the refunds to be wired to accounts in South Korea, Taiwan and Canada.
The focus on the Hawaii legal community may be new, but this type of scam is not. In 2008, the Journal reported an Atlanta attorney lost money in a similar scheme. The scammers in that case worked the bank system, causing a delay in processing the original cashier's check by changing the nine-digit number at the bottom of the check so that the money was wired to a different bank than the one named. Since lawyers are good clients, a bank may make funds available, even if a check has not cleared.
The FBI would like to remind lawyers from coast to coast that it is the best practice never to make a refund until the original payment has cleared.